What has been most irrationally beaten down?

Many of us, I’m sure, have tried (unsuccessfully, of course) to catch some falling knives over the past few months.

In considering again holding out my bandage-covered paw, I’m curious: which knife do you fellow Saul-boarders think has been most irrationally beaten down over the last few months?

A few conversation starters: SWKS? LGIH? SKS? SNCR? Something else?

They call me,
Mr TBS

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My vote would be LGIH, SNCR and BOFI. They all have great performance given their valuation. I can understand LGIH coming down a big given the November home sales number. Though it is still looking awfully appealing.
As far as BOFI and SNCR they are just down on fear. Nothing at all fundamentally to support the drop.

SWKS does look very appealing though I can’t comment because I don’t know anything about it. I tried to research it, but almost fell asleep. It just doesn’t appeal to me. SKS? Do you mean SKX? It is down a lot mostly irrationally though I would argue that at least the last call gave reason for the drop. The quality of that reason is debatable.
Either way in time the true values will eventually be realized good or bad.

I’m curious: which knife do you fellow Saul-boarders think has been most irrationally beaten down over the last few months? SWKS? LGIH? SKS? SNCR? Something else?

All of the above?

Saul

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SWKS, but it may get dragged lower from here temporarily if AAPL keeps falling.

I’d give a tongue in cheek suggestion of a beaten down anti-Saul stock, but it finally got a sell from a MF service after a 96%+ decline from highs and is a few cents higher than all time low prices… Oddly, unless they go bankrupt (which is possible), there isn’t much left to salvage, might be worth buying if you are a gambler… though I wouldn’t suggest it.

At least the market is near the bottom of the range it has been in the last 15 months or so. Hopefully it decides to go for the top of the range again.

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Hi Mike,

Regarding your comment about the market reaching the top of it’s range, I would like to share a quote from Warren Buffett:

Dec. 10, 2001: Warren Buffett on the stock market
“To refer to a personal taste of mine, I’m going to buy hamburgers the rest of my life. When hamburgers go down in price, we sing the ‘Hallelujah Chorus’ in the Buffett household. When hamburgers go up in price, we weep. For most people, it’s the same with everything in life they will be buying — except stocks. When stocks go down and you can get more for your money, people don’t like them anymore.”

http://fortune.com/2012/11/19/the-wit-and-wisdom-of-warren-b…

So if you have cash on hand or cash coming in via savings isn’t this a good thing? If you dividend reinvest or the companies you own buy back stock seems like a good deal too.

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Hi Plat,

Yes, selloffs that give you the opportunity to buy things at better prices with new cash are a good thing, but they are a bad thing when the value of existing holdings go down.

I’d venture to guess most investors have more capital already invested then they do on the sidelines, which makes it difficult to take advantage of the sales when your buying power gets cut as well in a decline.

You tell me, would you rather add money to holdings that are down 20, 30, or 50% and have them go up from there or would you rather add holdings to winners while on an uptrend as they go up? How “good” a selloff is really depends on how much cash you have on the sidelines.

While Buffet is a legendary investor, he has lots of quirky sayings that make more amusing sound bites than actionable advice. I doubt the price of burgers ever impacted his net worth in a meaningful way

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Point one:
Depends on your long term outlook.
Point two:
You should always have cash for opportunities.
Point three:
It depends on the business which is what Buffett was referencing. Good, steady, not going to die businesses. Know your merchandise.

Dec. 10, 2001: Warren Buffett on the stock market
“To refer to a personal taste of mine, I’m going to buy hamburgers…

I want to scream every time someone quotes Mr. Buffett! Thanks for doing one that’s a little different.

Ok, lets all go super overload on SWKS and then file our Form 4 and some PR’s for the Saul Value Group.

JT

Hey JT,

I want to scream every time someone quotes Mr. Buffett! Thanks for doing one that’s a little different.

Price is what you pay. Value is what you get.

It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently.

It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price.

Risk comes from not knowing what you’re doing.

Someone’s sitting in the shade today because someone planted a tree a long time ago.

You only have to do a very few things right in your life so long as you don’t do too many things wrong.

Our favorite holding period is forever.

Rule No.1: Never lose money. Rule No.2: Never forget rule No.1.

We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful.

In the business world, the rearview mirror is always clearer than the windshield.

These are all Buffet quotes :). :). :).

Andy
Who just like to hear people scream on a day like this.

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Andy:

https://www.youtube.com/watch?v=nxcJW6bs5os

Loading my gun… :wink:

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You should always have cash for opportunities.

Ah, but it is so much easier if you have people sending in insurance premiums that you can invest. And it is so much easier if you OWN a bunch of companies that spit out cash that you can invest at the right time. And it is so much easier if you are viewed as a white knight that won’t screw the company if they give you a great deal on a bail-out opportunity.

But yes, try to have some cash around :wink:

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